The chief economist at Barclays Capital says a key problem in Japan is the high level of share ownership by the banks and argues that the country needs to open up to foreign capital and labour.

JapanÆs globalisation has so far been outbound only. The next step is to open up the economy to foreign capital and labour û or face another fight with deflation, says Kyohei Morita. In an interview with FinanceAsia, the chief economist at Barclays Capital also notes that unless the global economy recovers, the Japanese economy is in for a double blow with a slowdown in the financial sector as well as the domestic economy.